FRANKLIN D. ROOSEVELT AND THE NEW DEAL

America: Past and Present

Chapter 26

The Great Depression

• 1920s optimism drives increase in expectations of a better way of life

• After 1929 despair sets in

The Great Crash

• 1928--soaring stock prices attract individual, corporate investment

• 1929--stock market crashes– directly affects 3 million– credit crunch stifles business

• Businesses lay off workers

• Demand for consumer goods declines

Unemployment, 1929-1942

Effects of the Depression

• Hardship affects all classes

• The middle class loses belief in ever-increasing prosperity

• Thousands of young homeless, jobless

Fighting the Depression

• Republican attempts to overcome catastrophe flounder

• Depression gives Democrats opportunity to regain power

Hoover and Voluntarism

• Hoover initially seeks solution through voluntary action, private charity

• Eventually aids farmers and bankers

• Resists Democratic efforts to give direct aid to the unemployed– perceived as indifferent to human

suffering– programs seen as incompetent

Bank Failures, 1929-1933

The Emergence of Roosevelt

• Franklin Roosevelt– born to wealth and privilege– 1921--crippled by polio– 1928--elected governor of New York– talented politician

• 1932--defeats Hoover with farmer- worker-immigrant-Catholic coalition

The Hundred Days

• Banking system saved from collapse

• Fifteen major laws provide relief

• New Deal aims to reform and restore, not nationalize, the economy

The Tennessee Valley Authority

Roosevelt and Recovery

• National Recovery Administration– industries formulate codes to eliminate cut-

throat competition, ensure labor peace– codes favor big business, unenforceable– 1935--NRA ruled unconstitutional

• Agricultural Adjustment Act of 1933– farmers paid to take land out of cultivation– prices increase– sharecroppers, tenant farmers dispossessed

Roosevelt and Relief

• 1933--Harry Hopkins placed in charge of RFC to direct aid to unemployed

• 1933--Civilian Conservation Corps provides employment to young people

• 1935--Works Progress Administration place unemployed on federal payroll

• Programs never sufficiently funded

Roosevelt and Reform

• 1933-34--focus on immediate problems

• 1935--shift to permanent economic reform

Challenges to FDR

• Father Charles Coughlin advocates nationalizing banks, anti-Semitism

• Francis Townsend calls for wealth redistribution from young to the elderly

• Huey Long calls for redistribution of wealth by seizing private fortunes

Social Security

• 1935--Social Security Act passed

• Criticisms– too few people would collect pensions – unemployment package inadequate

• Establishes pattern of government aid to poor, aged, handicapped

Labor Legislation

• 1935--Wagner Act – allows unions to organize – outlaws unfair labor practices

• 1938--Fair Labor Standard Act – maximum hour – minimum wage

Impact of the New Deal

• Had a broad influence on the quality of life in the U.S. in the 1930s

• Helps labor unions most

• Helps women, minorities least

Rise of Organized Labor

• 1932--National Recovery Act spurs union organizers

• Congress of Industrial Organization (CIO) formed by John L. Lewis

• CIO unionizes steel, auto industries

• 1940--CIO membership hits 5 million, 28% of labor force unionized

The New Deal Record on Help to Minorities

• Crop reduction program allows whites to fire or evict blacks, Hispanics

• Public works programs help by providing employment

• New Deal figures convince minorities that the government is on their side

• 1934--Indian Reorganization Act gives American Indians greater control

Women at Work

• Position of women deteriorates in ‘30s– jobs lost at a faster rate than men– hardly any New Deal programs help

• Progress in government– Frances Perkins, Secretary of Labor, the

first woman cabinet member– women appointed to several other posts– Eleanor Roosevelt a model for activism

End of the New Deal

• 1936--New Deal peaks with Roosevelt’s reelection

• Congress resists programs after 1936

The Election of 1936

• FDR’s campaign– attacks the rich – promises further reforms – defeats Republican Alf Landon

• Democrats win lopsided majorities in both houses of Congress

• FDR coalition: South, cities, labor, ethnic groups, African Americans, poor

The Supreme Court Fight

• Supreme Court blocks several of FDR’s first-term programs

• 1937--FDR seeks right to "pack" Court

• Congressional protest forces retreat

• FDR’s opponents emboldened

The New Deal in Decline

• 1936--cutbacks for relief agencies

• 1937--severe slump hits economy

• Roosevelt blamed, resorts to huge government spending

• 1938--Republican party revives

The New Deal and American Life

• New Deal’s limitations– depression not ended– economic system not fundamentally

altered – little done for those without political clout

• Achievements– Social Security, the Wagner Act – political realignment of the 1930s